About Indigo Platinum Mastercard

By J.R. Duren
HighYa Staff Published on: Sep 20, 2018

The Indigo Platinum Mastercard is a credit card for people with no credit or bad credit that provides rates and fees common to cards of this nature.

What makes it unique is that, for those who can meet certain qualifications, you won’t need to make any sort of down payment or pay an annual fee.

Credit cards for bad credit is a topic we’ve written about extensively, both in the form of card reviews and in-depth comparison guides. And rightly so – many people just like you are looking for ways they can boost their bad credit scores. Getting a card for consumers with bad credit is one way to do that.

Will the Indigo Platinum help you with that goal? What are its rates and fees? How does it compare to similar cards for people with bad credit?

These are the questions we’re going to answer in this review.

How the Indigo Platinum Will Help You Build Credit

When you have no credit history or a poor credit history, you are going to have low credit scores. When we say “credit scores,” we mean scores that various companies generate credit scores, in most cases, between 300 and 900 and are based on several factors.

The two most important factors in these scores are your payment history and the percentage of your credit limit(s) you’re using.

The first part is why getting a credit card to build credit history is an effective strategy. Lenders want to see that you’re responsible, that you make your monthly payments every month. They value this type of consistency. So, your credit scores will increase as you make on-time monthly payments.

The percentage of your credit card balances(s) you’re using is known as utilization ratio. Basically, lenders think it’s a red flag if you’re using most of the credit limit you’ve got. To them, it means there’s a good chance you don’t have enough cash coming in to pay your bills, so you’re covering the gap with your credit card. Not a good financial sign, they conclude.

Your Indigo Platinum card becomes a key to increasing your credit scores because you can use it as a tool to build up a good payment history and to show that you can use a credit card without maxing it out. More specifically, you need to prove that you can have a credit card and, every month, keep the balance below 30% of your credit limit.

So, if your Indigo card has a credit limit of $500 and you consistently have a balance of $400, your credit scores are going to stay lower than they should because you’re overextending yourself, according to scoring models.

But, if you can pay off your balance in full every month and Indigo tells the credit bureaus (Equifax, TransUnion, Experian) that your balance is zero, your scores are going to improve because your $0 balance means you’ve got the financial means to pay off your spending each month.

The Indigo card allows you to pay your balance through your online account. You can set up automatic payments each month through which you can pay the minimum or pay the entire balance. We suggest the second option if you can afford it because your credit scores will benefit.

The Indigo Card’s Rates and Fees

Credit cards are a great way to build your credit for the reasons we described in the previous section. The longer you make on-time payments and keep your balances below 30% of your limit, the higher your credit score will go. This is the good side of credit cards.

The bad side of credit cards, though, is how much they’ll cost you if you can’t handle them responsibly. That cost is the result of the following interest rates and fees you could pay with this card, which we’ll talk about after the list:

  • APR: 23.9%
  • Penalty APR: 29.99%
  • Cash advance: 0% during the first year, 5% after
  • Foreign transaction fee: 1%
  • Late/over-limit/returned payment fee: $38
  • Annual fee: $0/$59/$99

Anytime you pay your bill late you and/or you don’t pay your full balance each month, Indigo is going to charge you fees.

For example, if you have a balance of $200 and you make a minimum payment of $25 (your statement will tell you what your exact minimum payment is), then the other $175 is subject to the APR. At 23.9%, you’ll pay $3.50 in interest.

If you happen to pay late, then Indigo will charge you $38, which will show up on your recent transactions list in your online account.

The penalty APR is another way that you can lose money. If you make one late payment, not only will you get up to a $38 charge, but your interest rate will change from 23.9% to 29.99% permanently, in most cases. With this new APR, the $175 balance will cost you $4.30.

The goal of using credit cards is to avoid all these fees. Pay your card on time and pay it in full.

Now, the only fee you can’t avoid is the annual fee. The Indigo Platinum has three different annual fees: $0, $59 or $75 the first year and $99 after that.

Indigo decides which one you get based on your credit scores, which means you won’t know your annual fee until Indigo notifies you they’ve approved you for a card.

What makes this card a little different from other credit cards for bad credit is that it doesn’t require a security deposit. Some cards for bad credit are known as “secured cards” because you have to provide a security deposit that the bank can use to pay your bill if you don’t. The deposit “secures” your account.

How the Indigo Platinum Mastercard Compares to Other Cards for Bad Credit

The following chart shows you how the Indigo compares to other credit cards for bad credit:

Indigo Platinum Total Visa Discover it Secured Credit One Platinum
APR 23.90% 29.99% 24.74% 19.74% - 25.74%
Penalty APR 29.99% None None None
Annual Fee $0/$59/$99 $48 $37 $0 - $99
Rewards None None 2% on gas, 1% everything else 1% on everything
Security Deposit None None Yes, $200 - $500 None
Extra Yearly Fees None $75 None None

This chart reveals that credit cards for bad credit are pretty diverse. The Indigo is the only card that doesn’t have any extra fees, a deposit or rewards. In one sense, this is good, because it simplifies your card.

The downside to a lack of rewards, though, is that your credit card isn’t working on your behalf. The Discover it Secured, for example, will give you 2% cash back on gas purchases and 1% on non-gas purchases. So, if you spend $50 a month on gas and $300 on everything else, then you can earn $4 a month in rewards, or $48 per year.

The Discover it Secured and the Credit One Platinum Visa have the rewards advantage over the Indigo card. The Credit One card has a lower best APR but you won’t know if you get that APR until you’re approved.

However, the Indigo’s penalty APR is a drawback because neither the Discover or Credit One cards have a penalty APR.

As far annual fees go, the Indigo, Discover and Credit One are the cards that offer a $0 annual fee. The Discover it Secured charges no annual fee no matter what your credit scores are, whereas the Indigo and Credit One will determine your annual fee based on your credit score.

In general, the Indigo card is middle-of-the-pack when compared to other credit cards for bad credit. We think the Discover it Secured is slightly better because of the rewards and lack of an annual fee, but you have to submit a security deposit to use it.

We think the Credit One Platinum is a slightly better choice than the Indigo because of the 1% rewards rate and the chance at getting a lower APR than the Indigo.

The Indigo is a better choice than the Total Visa because its fees and APR are higher.

Is Indigo Platinum Mastercard a Good Option for People with Bad Credit?

In our opinion, the Indigo has a couple of clear strength. First, the APR is pretty reasonable, considering what those with the lowest credit scores would end up getting with other cards APR’s that are higher than the Indigo.

Second, we believe the card’s lack of a security deposit and extra fees is a bonus, too. This eases the financial burden on you, allowing you to use the extra money to make sure that you’re paying off your card in full every month.

The downsides to the card are that it has a penalty APR and that it doesn’t provide rewards. Now, these two downsides aren’t that big of a deal if your goal is to use this card to build up your credit so that you can move up to a better rewards card like the Discover it Chrome.

If you aren’t convinced the Indigo is right for you, check out our guide to some of the top credit cards for bad credit. In it, we examine each card via its pros and cons. Reading through this guide will give you a more in-depth look at these cards than what you read in the comparison section of this review.

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